On July 15, millions of working class parents across America woke up to a welcome surprise: hundreds of dollars directly deposited into their bank accounts with the “CHILDCTC” label. The first payment of the planned expanded child tax credit, passed as part of Biden’s $ 1.9 trillion Covid-19 relief program, had arrived for eligible families with children under the age of 18.
Parents had the option of receiving half of the annual tax credit in six monthly installments of up to $ 300 for each child under 6 and $ 250 for children 6 to 17; the other half of the credit will be granted in 2022. Eligibility is based on income and filing status – married filers, for example, must have adjusted gross income of less than $ 150,000 per year to receive the credit. full, which gradually disappears with higher incomes.
The money comes as Americans are still reeling from the devastating emotional and economic impact of the pandemic. But the financial impact of raising children was an issue long before last year – in the United States, nearly one in five children live in poverty. Parents spend on average just over $ 750 per child per month on child care and about $ 722 on groceries for a family of three. And in 2021, rental prices jumped 9.2%, bringing the national average monthly cost of one and two bedroom apartments to over $ 1,700 and $ 1,900 respectively, according to real estate reports.
Low-income families have borne the brunt, especially as school closings have forced parents to forgo their income to care for their children. For many of these families, the monthly benefit is a much-needed relief and a lifeline after a year of hardship. “By getting these payments now, I know that at least I have some help covering food,” said David Watson, technician and single parent of two. “Now I can cut overtime. I need some sleep, man.
Vox explained to three parents how, after struggling financially during the pandemic, they believe these payments will improve their lives. Our conversations have been edited and condensed for clarity.
“I can’t tell you how relieved I was”
David Watson, technician, father of two, New Jersey
My shoulders are already lighter.
I am a single mother with two children: my son Suleemon, 11, and my daughter Haleemah, 17. Their mother has struggled with drug addiction and is not supporting them financially. Money is always tight for us because the rent and the cost of living here are so high.
Before the pandemic, things were tough, but Covid made everything more uncertain and brought a lot of challenges. Between monitoring my kids’ online education and juggling my job, I felt like I was going to lose my mind. I can’t imagine how parents with young children do it.
Usually I would work overtime to compensate for rent and unforeseen costs, but with Covid it was impossible to keep up with the regular work week which made overtime impossible. Then my job announced that staff would be put on leave for the summer. They told us to file unemployment claims to help us stay paid. Around this time, unemployment benefits also came with the additional $ 600. I was excited to finally be able to take a break – but that never happened. My jobless claim was refused because someone tried to open a fraudulent claim, which blocked my social security number. I called all the numbers and visited all the unemployment and social security offices, but still not everything is back to normal, so I cannot get help. We relied on pantries and I took out a loan from my pension to get us out. The struggle was real!
Then my son broke both his arms in a freak skating accident. At one point, I couldn’t work, to help her do everything. I am proud to say that in June my daughter graduated from high school. But between graduation fees and college admission applications, more money was needed.
When I heard about the child tax credit I was hopeful, but after the year I had, I didn’t want too much. Then on July 15th I was on my last $ 60 and wondering how to make it last for two weeks when I got a text saying I had a $ 500 deposit in my account. The child tax credit has been granted. I can’t tell you how relieved I was.
Part of me wishes it was more, but I don’t want to sound ungrateful, and… that’s something. People I know never received it or received the wrong amount. I know I can opt out and receive this money next year, but for us it is not an option. As I receive these payments now, I know that at least I have some help covering food. I can withdraw the overtime. I need some sleep, man.
“My goal at the moment is to create generational wealth”
Shakisha Harvell, entrepreneur, mother of two, Virginia
The father of my two children – Shakisha, 9 and Shaquan, 12 – and I parted ways a few years ago, and since then he has not been a constant provider. We moved from New York to Virginia shortly before Covid hit to find more affordable housing and a better standard of living. In Virginia, we have settled down well. The kids went to better schools and I started my own business. I opened my own store selling clothes, jewelry and household items. Things were improving.
In the summer of 2020, we closed due to Covid restrictions and my income almost dried up. When we reopened, it wasn’t the same. My regular customers found it difficult to shop, especially with the 10 person maximum restriction that was in effect at the time.
Worse yet, my kids were now attending online school. If it was not about technical difficulties, it was about tackling teachers’ problems. When I tried to work during school hours, I would get messages from teachers about children not attending or failing to hand in their homework. My daughter and her teacher always seemed to be fighting each other. And my son was withdrawing from a lack of social interaction. They seemed to lag even more behind, so I changed my working hours. The time I usually spent on my business was now spent in classes with my children.
Eventually I applied for unemployment and started receiving payments. We were now living on half of my usual income. My kids even got involved and started baking and selling cakes to earn money.
The extra $ 500 will help us stay stable – it’s not the generational wealth creation that politicians talk about all the time, but it’s better than nothing. My goal right now is to build generational wealth. Most of my family grew up in projects, and I don’t want my kids to be stuck there. Black people in America never really get the chance to grow up.
My kids have outgrown their clothes and need a new summer wardrobe, so I’m going to use the money for that. But at some point I want to use some of it to encourage entrepreneurship in my kids. I want them to learn all about business from a young age. I think of a popcorn and ice maker to start them. It can go well with their cake business.
“We will finally be able to afford aid again”
Melissa Petro, freelance writer, mother of two, New York
Before the start of the pandemic, I was struggling to juggle motherhood and my job. I had two kids under 2 and it was tough. We couldn’t afford to hire someone to watch them so I could work, but we needed the income. For a while, I tried to do homework during their naps or after my husband came home from work. It was tiring. Eventually my son went to daycare for six months. Then Covid started.
When daycares closed, work became impossible. Luckily I went on employment assistance, which was amazing. In the end, I didn’t have to kill myself with different jobs. I could just watch my kids and get paid for it. But we still couldn’t afford to have a nanny. We just hired young people to help watch them here and there. So that meant my career was really hurting.
With the extra money from the child tax credit, we can finally afford help again. Now, instead of hiring kids who don’t really need a job, we can pay the right wages and hire someone we can trust. We still cannot afford full time care which would cost around $ 4000 / month for two children but we are looking for a part time nanny and I am grateful that I can afford any help. Credit money doesn’t change your life – because everything in New York City is so expensive – but it does put a dent in the child care bill.